My personal blog about international trade, public policy & politics, pop culture, and stuff that probably interests only me

Friday, January 22, 2010

Could the WTO Tear Down China's Great Firewall?

Reuters reports that the United States Trade Representative (USTR) is "mulling" (great word!) a challenge to China's internet restrictions - the humorously-named-but-not-actually-funny-at-all "Great Firewall of China":

U.S. trade officials have asked for more information as they weigh whether to pursue a case against Chinese Internet restrictions that impede Google and other companies, an attorney for a U.S. free speech group said on Friday.

"They've asked us for more detail about it. We are trying to put that together right now," said Gilbert Kaplan, a partner at King and Spalding, which represents the First Amendment Coalition, a nonprofit advocacy group...

The U.S. free speech group, known then as the California First Amendment Coalition, first approached the U.S. Trade Representative's office in late 2007 with the idea of challenging China's barriers to Internet access at the World Trade Organization.

It gave the trade office, run at the time by the Republican administration of former President George W. Bush, "a very extensive white paper, or memo, describing the WTO violations that the 'Great Firewall' caused, and that were actionable in our view under the WTO, and a request that USTR begin a WTO case against China regarding the Firewall," Kaplan said.

Although no case was filed, Kaplan said U.S. trade officials never ruled out that possibility.

"We're continuing to request that they start that case. That dialogue is continuing," Kaplan said.

A spokeswoman for the U.S. trade representative's office had no immediate comment.

A study by the Brussels-based think tank ECIPE in November called government censorship the biggest trade barrier that Internet companies face.

Many countries censor the Internet for political or moral reasons. China has developed one of the most pervasive methods. In Cuba, all unauthorized surfing is illegal, while many Western countries limit access to child porn sites.

A WTO case could help "clarify the circumstances in which different forms of censorship are WTO-consistent," ECIPE said....

China agreed as part of its commitments to join the WTO in 2001 that U.S. service companies would have the same access in China as their own companies.

"We believe that applies to the Internet and Internet companies," Kaplan said.

China's web restrictions in effect force U.S. Internet companies to "put servers and hardware in China, rather than doing what they do everywhere else in the world, which is use their U.S. base," Kaplan said.

"If we try to serve the Chinese market from the U.S. or anywhere outside the Great Firewall, our Internet access is so slow that no one will use our sites," he said.

WTO rules also require countries to follow transparent and understandable procedures, he said.

Instead, China "is very randomly stopping our Internet companies and our Internet access with no prior notice and no set of regulations," Kaplan said.

The free speech group's 2007 white paper is here, and they state that China's internet restrictions violate a whole host of WTO rules, including GATT Article III (national treatment), China's services commitments under the GATS and China's WTO Accession Protocol.

There's certainly not enough information in the white paper to judge whether these allegations are really solid, but even if they are, there are several reasons to doubt that USTR will end up bringing a WTO complaint against the Great Firewall:

From a basic legal perspective, the white paper does not preemptively address or rebut China's inevitable claim that, even if the Great Firewall violates some WTO rules (and I'm not saying it does or doesn't), it's still permissible under the general exceptions of GATT Article XX - particularly GATT Article XX(a) which exempts from WTO disciplines "illegal" trade measures that are "necessary to protect public morals." The standards for applying any Art. XX exception are very high, but one must wonder whether a WTO panel or the Appellate Body would really be willing to rule against China's Art. XX(a) claims, regardless of their strength or weakness. (This is especially true considering that the WTO implicitly advocated deference to countries Art. XX defenses with respect to potentially protectionist climate change regulations.)

I also wonder whether USTR and the White House will be willing to bring the case given the potentially serious diplomatic concerns surrounding it. This is one hot diplomatic potato, and China would not take kindly to such a public and direct challenge to its sovereignty. Instead, might the White House prefer to resolve Google's complaints through quiet diplomacy rather than WTO litigation? A case like this would no doubt dominate the headlines and could force China's discolsure of sensitive information, thus potentially salting the already-strained US-China relationship. As such, the diplomatic route appears more likely.

Finally, I question whether China would comply with any WTO ruling against the Great Firewall, and wonder whether the United States really wants to deal with the damaging repercussions of any such non-compliance for a WTO that's already reeling from a messy and comatose Doha negotiating round. As the US is well-aware (see, e.g., internet gambling or cotton subsidies), compliance with adverse WTO rulings is discretionary (Members can choose to be hit with retaliatory tariffs instead), so the chances that China accepts a WTO ruling and changes its internet systems seem slim. Non-compliance seems more likely, and that would open up yet another can of worms. Indeed, I don't know that China would even comply with the WTO's informational requests on this issue (it often refuses in US trade litigation). Would the United States really want to instigate a case that it knows China will never abide by? Would that really be good for the multilateral trading system? It seems to me that the answer to both of these is "no."

Then again, USTR chose the passive route in 2007 - for either diplomatic or legal reasons - and look where that got us. So maybe this White House thinks that the risks are worth it. I doubt it, but I'm obviously not at USTR or advising the White House, and I definitely haven't analyzed the legality very closely. So maybe I'm missing the airtight legal arguments or some important diplomatic angles. Only time will tell, I guess.

Needless to say, this is one potential case that I'll definitely be watching. And for once, I'll probably not be the only person (or one of the only ten people) keeping an eye out.

Final note: I should be clear here that I'm in no way opposing a WTO case against, or any other legitimate challenge to, Chinese censorship. It would be a fantastic thing for liberty - and the Chinese citizenry! - if the US could somehow find a "soft" way to reduce China's strict informational controls. I just think that USTR will end up passing on this case, and that this announcement is more a PR/diplomacy move than realistic challenge. But, hey, maybe I'm wrong. Wouldn't be the first time.